Oil rises after OPEC maintains demand forecast; Brent crude at $84.67/bbl

Oil prices steadied on Wednesday as the Organization of the Petroleum Exporting Countries (OPEC) maintained its growth forecasts for oil demand for this year and next year, while US crude and gasoline stockpiles likely fell last week .

By 1312 GMT, Brent futures were up 1 cent, or 0.01 percent, at $84.67 a barrel, after falling 1.3 percent in the previous session. Meanwhile, U.S. West Texas Intermediate (WTI) crude rose 11 cents, or 0.11 percent, to $81.52 a barrel, after falling 1.1 percent in the previous session.

“Crude oil prices traded lower against a firm dollar and the hurricane that hit Texas caused less damage than expected. Worries of reduced supply have weighed on oil prices. In addition, weakness in Chinese crude oil demand also affected the price of oil to fall below the $82 mark. Meanwhile, tensions in the Middle East and lower supplies from Russia supported oil prices,” brokerage firm ICICI Direct said in a report.

What is weighing on the price of crude oil?

In its monthly report released on Wednesday, OPEC reaffirmed its growth forecasts for global oil demand, projecting an increase of 2.25 million barrels per day (bpd) in 2024 and 1.85 million barrels per day in 2025.

“Strong mobility and air travel in the Northern Hemisphere during the summer/holiday season is expected to boost demand for transportation fuels and boost growth in the United States,” OPEC said, as quoted by Reuters.

According to market sources citing American Petroleum Institute figures on Tuesday, US crude oil inventories fell by 1.923 million barrels, while gasoline stocks fell by 2.954 million barrels. Official data from the US Energy Information Administration is scheduled to be released at 14:30 GMT.

Both contracts ended the past three sessions lower as the Texas energy industry appeared largely unaffected by Hurricane Beryl.

Oil and gas companies resumed some operations on Tuesday. Some ports have reopened and most producers are ramping up production, although some facilities have suffered damage and are awaiting full power restoration.

In the Middle East, ceasefire negotiations for the conflict in Gaza are set to resume in Doha, with the participation of the intelligence chiefs of Egypt, the United States and Israel.

Concerns about demand in China also pressured prices. Consumer prices in the world’s second-largest economy rose for a fifth straight month in June but missed expectations as output price deflation continued.

In its annual Energy Outlook report released on Wednesday, BP said it expects oil demand to peak next year, with rapid growth in wind and solar capacity in both main scenarios.